How to Know If You Need Private Portfolio Management

When it comes to your money, you want to be smart. You want to invest, save, and manage it properly. However, there are times when you just can’t do this yourself and you need a professional to step in. 

How do you know you need private portfolio management, though? And how do you know it is the right choice for you? It helps to learn more about the process.

What Are Portfolio Management Options?

Portfolio management is about how your money is managed. It involves making investments, setting up asset allocation, and maximizing your returns. Portfolio management is usually either done by an investment company or is self-managed, and both options have pros and cons. 

If you choose to self-manage, you have complete control of your investments, but the time and resource commitment to the process is substantial and can be overwhelming. The other option is to use a professional portfolio management company. 

Although you have less direct control, professional investment firms relieve the day-to-day portfolio management responsibilities and can constantly research the latest developments in the financial world.

Do You Need Professional Portfolio Management?

Professional portfolio management isn’t for everyone, but there are some people who will greatly benefit from it. In general, if you have considerable assets and wealth, you are a great candidate for portfolio management. 

It can be very difficult for a person who is not educated in finance and investing to understand the detailed ins and outs in this field. When you are dealing with large amounts of money, there really is no room for a mistake. 

The combination of a large amount of money and a lack of knowledge is a problem and is where the investment manager can really be helpful. This is especially true if you experience a sudden windfall and end up with more money than you have ever had before. 

This is a scary situation because you certainly don’t want to lose the money on bad investments, so portfolio management allows you to be sure that your money is being handled correctly and lowers the risk of losing it all. 

There are different types of investment companies, and you should research how each company manages their client’s portfolios, the fees they charge and the level of service provided. There are many resources on the internet to help you decide what type of company works for you. 

For example, if customer service is very important to you, there is a video from Damian Ornani at Fisher Investments explaining how the role of the Investment Counselor is key to their firm’s commitment to high customer service. Or if fees are a deciding factor, research how different company’s fees are calculated so there are no surprises. 

Another situation where professional management can come in handy is if you have complicated estate needs. You can’t manage your money after your death, so you need someone who can. 

By having a professionally managed portfolio, your investment counselor can set up your estate and assist with ensuring things are transferred and managed smoothly after you are no longer here to do so yourself.

What To Expect From the Process

Once you decide that you do need private portfolio management, you will need to contact the company you’re interested in and schedule an appointment to discuss your investment needs. You may have to meet a few times or you may meet just once initially. 

When you meet with the company’s representative, you will go over all your financial information and develop guidelines for your working relationship. You will also have a chance to ask questions. 

Usually, you will discuss your goals and establish a timeline for reaching them. Your goals are very important for the counselor to understand in order to be able to do his or her job. Knowing how to invest and what strategies to take are really going to be dependent on your goals. You’ll also go over cash flow and what is required for investments. 

You will go over your assets, and may discuss even those assets you aren’t having managed by the company. This is also the time you will talk about your preferences and things you don’t want to see happen with your money. 

If you want, retirement and estate planning may also be gone over. Finally, you will cover taxes, fees and communications. You’ll likely set up communication parameters, like how often you want to meet and be informed about what is going on with your portfolio.

Private portfolio management is a good idea if you are dealing with a large number of assets. It is a smart move to involve a professional who is skilled and knowledgeable in investments. 

Not only will this allow you to make the most out of your investments but it offers a layer of stability to your activities because you aren’t just working in the dark and trying to make investments that you know little or nothing about.